If the old accumulated loss is not adjusted before the admission of a new partner, which burden may unfairly fall on the new partner?

Correct answer: Burden of old accumulated loss

An old accumulated loss relates to the period before the new partner’s admission, so it should be adjusted through the old partners’ capital or current accounts in their old profit-sharing ratio. If it is not adjusted, the new partner may indirectly bear an unfair share of that loss. Exam tip: losses arising before admission belong to the old partners.